Question

Ethics is so important in financial accounting and reporting that the government has passed a law regulating ethical actions of businesses related to their financial reporting practices. why is ethics in financial reporting so important for the country's economy?

Answer 1

Ethics is incredibly important when it comes to financial reporting and accounting, so important that the government saw fit to pass a law that regulates the actions of businesses and how ethical they are when it comes to how they report. The reason that ethics is so very important when it comes to the economy of the country is because if there is a reason to believe that companies are using unethical practices in reporting, it allows investors and creditors to back away and not offer any more financial backing.